If you’ve ever moved across state lines, you may have been surprised to see how much your insurance premiums changed after the move. There are many factors that influence auto insurance rates, and the state where a policy is written can have a tremendous effect on that policy even if all other factors are equal.
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Insurance rates vary between states for many reasons. In general, insurance companies calculate their rates based on the driver’s risk of being involved in an accident. Certain factors make accidents more likely in certain areas. The two biggest factors are drunk drivers and uninsured motorists; the most expensive states will have a large number of both. Other factors include a state’s population, crime rate, weather patterns and any laws that may affect the sale or use of insurance.
Here are the 10 cheapest states for car insurance:
1.) Maine: With just 4 percent of its motorists driving without insurance, Maine has the lowest incidence of uninsured drivers in the country. Its rural roads are also less likely to be congested, which reduces the likelihood of accidents occurring.
2.) Iowa: Unlike other states, Iowa does not have a mandatory minimum for liability coverage. This means that drivers can choose a policy with much lower limits in this state than they could otherwise, which drives down the average cost of premiums.
3.) North Carolina: Around 8 percent of North Carolina drivers are uninsured, which gives it the sixth-lowest rate of uninsured drivers in the country. Judges are also somewhat less likely to rule favorably to injury claims in this state, which keeps prices low.
4.) Ohio: State laws keep the minimum liability limits in Ohio quite low, which helps to keep prices down. Excellent public transportation in and between the state’s major cities also helps keep drivers off the road to reduce accidents.
5.) Idaho: This rural farm state has few congested city roads and a low incidence of property crime and theft. Recent changes in drunk driving laws have also dramatically reduced the number of DUI-related deaths in the area, which keeps insurance costs low.
6.) Vermont: Once the cheapest state for insurance, Vermont’s rates have begun to creep upward but remain quite affordable. Vermont has the second-lowest incidence of uninsured drivers and a healthy local economy that helps most drivers afford good coverage.
7.) Indiana: Ranked 16th in the nation for drunk driving, Indiana has a lower incidence of DUI claims than many other states. Like many of the other states with low premiums, it’s also a predominately rural state.
8.) Washington: Although traffic in Seattle can be harrowing, more residents are using the excellent public transportation system and avoiding congested roads. In the more rural parts of the state, accidents are even more unlikely.
9.) Arizona: With the ninth-lowest incidence of drunk driving in the country, Arizona roads are some of the safest in the Southwest. Year-round mild weather helps to prevent many accidents as well.
10.) Wisconsin: Although Wisconsin has a few accident risk factors, including a higher-than-average rate of DUIs, the open spaces and rural areas help keep the overall number of accidents down.
Although the most expensive states, Louisiana and Michigan, have stayed the same for many years, the cheapest states fluctuate from one year to the next. In general, though, the cheapest auto insurance will always be available in areas with low populations, fewer uninsured drivers, less crime and more public transportation.